For the We Buy Houses® 2018 Housing Report, we asked 41 of our local real estate experts in 33 markets around the country about their sentiment regarding their local housing market for the coming year. Specifically, we asked 5 questions:

1) In 2018, will it be a SELLER’S or BUYER’S MARKET (or EVEN) in your area?2) HOME PRICES – going up, down or about the same as 2017?3) INVENTORY OF EXISTING HOMES FOR SALE – going up, down or about the same?4) CONTRACTOR COST (LABOR) – going up, down or about the same?5) MATERIAL COST – going up, down or about the same?

NATIONAL Summary:

According to the local market real estate experts at We Buy Houses®, 2018 will continue to be a “Seller’s Market” in over 70% of suburban markets in the U.S., with slightly less than 10% predicting that it will a “Buyer’s Market” next year.

Home prices are expected to rise again in over 60% of U.S. markets, and expected to stay about the same in over 34%. Our experts expect there to be lower inventory in over 31% of local markets, with inventory increasing in only about 22% of markets next year.

Regarding the costs for renovation, We Buy Houses® local market representatives expect the cost of contractors (labor) to rise in 48% of markets and stay about the same in another 48% of our areas, leaving only a few percent of our markets in which cost of labor is expected to decrease. The cost of materials is expected to rise again in 49% of U.S. markets and stay about the same as last year in the other 51%. There were no respondents that expect material costs to decrease next year.

Conclusion: It’s a Seller’s Market again for most local markets in 2018. We Buy Houses® expects home prices to rise 4% to 8% in major suburban markets in 2018, with a median increase of 5.5% We expect the median price of homes to rise from $248,000 in December 2017 to $262,000 by the end of this year.

REGIONAL Summaries:

The Northeast

We Buy Houses® local market experts in the northeastern U.S. expect a Seller’s Market again with along with rising prices, with all other factors (housing inventory, cost of labor, cost of materials) being about the same as 2017. The “HOTTEST” We Buy Houses® market in the Northeast in 2018 is expected to be Washington, D.C.

The Southeast

In the southeastern markets, we expect a Seller’s Market with rising home prices and increasing cost of materials. Inventory will remain tight and cost of labor will be about the same as 2017. The Florida area was hit by hurricane Irma in 2017, which has contributed to an increase in material costs at the onset of 2018. The “HOTTEST” We Buy Houses® market in the Southeast in 2018 is expected to be Charlotte, N.C.

The South

The southern region of the U.S. is likely the “hottest” of the four regions identified by We Buy Houses® and it will be a Seller’s Market in 2018. Our local market experts are expecting home prices to rise along with the cost of labor and materials, in part due to the residual effects of Hurricane Harvey in 2017. Inventory is expected to remain about the same as 2017, a year in which housing inventory in the South was very tight. The “HOTTEST” We Buy Houses® market in the South in 2018 is expected to be Memphis, TN. (However, Waco, TX emerged as one of the most attractive and productive markets in the We Buy Houses® system in 2017, perhaps due to the popularity the area has received from the HGTV show “Fixer Upper”).

The West

The western U.S. is the most competitive region for our professional real estate investors and it will definitely be a Seller’s Market again in 2018. Prices in prime suburban markets in the west – such as San Diego, CA and Colorado Springs, CO – will continue to rise in 2018 as inventories remain very constrained. We expect the cost of labor and materials to be about the same as in 2017. The “HOTTEST” We Buy Houses® market in the West in 2018 is expected to be Seattle, WA.

PRESS: Materials available include local market infographics and local expert commentary for all 33 markets and the 4 regions. Our CEO, VP of Marketing, and local market experts are available for interviews, and high-resolution headshots are available as well.

FOR MORE INFORMATION: Contact We Buy Houses® at PRESS@WeBuyHouses.com or (817) 251-8296

THE WE BUY HOUSES® 2018 HOUSING MARKET REPORT (EXPANDED)

We asked these 5 questions of 41 local market experts in 33 local markets across the U.S.:

What type of market will it be in your area next year?

a seller’s market

a buyer’s market

or about even

Do you expect home prices to…?

Rise

Fall

Or be about the same as in 2017

Are you expecting the available inventory of investment properties to…?

Increase

Decrease

Or be about the same as 2017

Do you expect the cost of labor & contractors in your market to…?

Rise due to high demand

Fall due to less demand

Or stay about the same as in 2017

Do you expect material costs to…?

Rise due to high demand

Fall due to less demand

Or stay about the same as 2017

In this report we’ll look at our experts answers to these five questions on three levels: national, regional, and local. Let’s start at the national overview level, and review what the 41 We Buy Houses® local market experts in 33 markets told us.

National > Overview

Type of Market

They said that next year in 70.7% of their markets, it will be a seller’s market, and only in about 9.8% will it be a buyer’s market. The other 19.5% they’re saying about even. This is our third year of doing the report, and this is consistent with what we’ve seen in the past; the housing market continues to be a seller’s market due to tight inventory levels. Demand for single-family homes will continue to exceed the supply in 2018.

Home Prices

Regarding pricing on a national level, We Buy Houses® business owners across the United States expect prices to rise in 63.4% of their markets, and to stay about the same as in 2017 in 34.1% of their markets. That leaves just 2.5% where they believe homes prices may fall.

Inventory

Regarding inventory in 2018, the We Buy Houses® local market experts are expecting inventory to increase in only 22% of markets, whereas in 46% they expect it to be about the same as 2017 – which you remember was very tight – and actually decrease in 31% of their markets. We continue to see inventory of single-family homes being very tight, very constrained in 2018, similar to what we’ve seen the past two years.

Cost of Labor

Regarding the cost of labor, the local market experts at We Buy Houses® say that they expect labor costs to rise in 48.8% of the markets, and stay about the same in 48.8%. That just leaves 2.4% where the cost of labor may fall. We are expecting the availability of contractors to be tight in 2018, and therefore we’re expecting rising costs in many of our markets.

Cost of Materials

Regarding the cost of materials in 2018, our local market experts continue to see material costs rise and 48.8% of the markets, and they say it will stay about the same in 51.2%, which again we saw rising prices in 2017, so overall, we believe that the cost of materials will be increasing in 2018 for most of our professional real estate investors.

Regional Perspectives

Let’s dig into the regional perspectives, and focus on each region of the United States, and then individual cities within those regions. Before that, I want to explain the graphic that we will be looking at as we look at each of the regions.

About the Graphic

The graphic encapsulates the questions the five questions: what type of market will it be, and what change, if any, is expected to happen in home prices, inventory levels, contractor costs, and materials costs in 2018. A “HOT” market looks the one on the left (or top, if you’re on a phone): prices are going up, inventory is going down, and the cost to repair homes – the contractors and materials – are going up as well. It’s not necessarily good to be in a hot market; in fact, it can be very difficult to find properties to buy in a hot market. The one advantage of a hot market is when we do find properties, and are able to get the contractors, and the materials and repair those homes and bring them back to excellent condition, those homes sell for top price very, very quickly.

A “COLD” market will look like the graphic on the right (or bottom): home prices dropping, inventories increasing, the cost of contractors is going down (because they’re having a difficult time finding work). Material costs could also be decreasing, but we didn’t see this in any market anywhere for our 2018 study. Nobody is expecting a decrease in the cost of materials, but it would more likely occur in a cold market. In this type of market, it’s a buyer’s market, and so it’s easy to buy houses. There’s plenty of inventory, and prices are dropping, but once you buy them, and fix them, you may find it’s difficult to sell them, or they sell for less than you anticipated. Once again it’s not necessarily great to be in a hot, hot market or in a cold, cold market. We really like our markets to be just like the story of the three bears; we like our markets to be warm, kind of in the middle.

Let’s dive into the regions.

The Northeast

The first region we’re going to look at is the Northeast. When we look at the Northeast, the regional graphic (above) tells us in the Northeast, prices will be going up, and inventory, contractors, and materials will be about the same as they were in 2017, which means again continued constraints on inventory in that market area.

If we dig into the cities of the Northeast, we have these seven represented in the study: Columbus, Ohio; Cleveland, Ohio; Cincinnati, Ohio; North Detroit, Michigan; Minneapolis, Minnesota; Washington, D.C.; and Virginia Beach, Virginia.

While Columbus has home prices going up, they also see an increase in inventory & it’s the same thing in the northern Detroit area of Michigan. Washington D.C. is a typical hot market, like you saw in our example graphic: price going up inventory going down and the cost of contractors and materials are on the rise. As you look around you can see that Ohio is kind of a little bit of a mixed bag. The Cleveland market is colder than the Columbus market, and Cincinnati market is, perhaps, the coldest of them all of the Ohio markets. Each of these give you a different view, and we see that when you look at it at a regional level, we definitely see home prices rising, and inventory about the same as last year, but when you dig in to the local markets, sometimes you see something quite different.

As we looked at the comments made by the We Buy Houses® local market experts in the Northeast, they definitely represent something that we’re seeing across the country. Rob Michaels in Minneapolis, Minnesota says “the increase of competition” is going to be a challenge in 2018, as “there seems to be more investors every day.” Jerry Jewell in Washington, D.C. talks about there being “less inventory,” and Brooks Humphreys in Columbus talks about “high competition for deals, low supply, and high construction prices.” That’s exactly what we’re talking about; that confluence of conditions of high demand, low supply, and high cost to repair. Now as far as opportunities, Jeff Baker in Cincinnati mentioned “some of the more trendy, popular areas in town will undergo gentrification in order to appeal to the mass market,” and we’re definitely seeing this in Cleveland, Cincinnati, and a lot of markets where we’re seeing gentrification. It really points us in the right direction as far as the neighborhoods that we want to go to next. You know what areas are becoming more trendy and cool, where are the people going, and buying, and really starting to renovate neighborhoods, and that’s exactly what we’re seeing in many of the neighborhoods in the Northeast.

The Southeast

In the Southeast, we’re expecting home prices to rise, and inventory and the cost of contractors to be about the same as last year, but we are expecting material costs to increase. The southeast is one of the regions that was struck by a major hurricanein 2017, and we see it was a contributing factor to the rising cost of materials in many markets.

If we look at cities within the Southeast we noticed that Charlotte, North Carolina is that typical hot market profile: increasing home prices, decreasing inventory, and the cost of contractors and materials is rising. If you go down to, say, a smaller market like a Sarasota, Florida, they’re basically expecting 2018 to be just like 2017, which was a tight inventory market, and prices have come up but they’re not necessarily looking for price increases next year. That’s also true in Winston-Salem, North Carolina. You can see that the conditions vary a little bit as you go across the markets, but in most cases, we’re expecting an increase in home prices, and inventory to be about the same as last year in the Southeast.

When we look at quotes from the Southeast from our experts, in Winston-Salem, North Carolina, we see a “tightening labor market,” according to Garfield Duncan, and other issues such as “laborers being driven away, and the ones left are either doped-up or too old to work.” We wondered about including this comment in the study, but it really has become a problem for us in some of our markets especially in West Virginia, North Carolina, and some of the other states on the East Coast, where things like the opioid epidemic have definitely impacted our availability of quality contractors. It’s unfortunate, but it’s true, and we’ve seen the impact of it in our study and in our results in 2017. Garfield sees that his biggest opportunity is to “[expand] beyond single-family homes,” in that very hot Winston-Salem, North Carolina market. Some other comments that we had in the Southeast: in Atlanta, Georgia Brooks Humphrey said their greatest opportunity in 2018 is to “take advantage of Atlanta’s rapid gentrification in neighborhoods around the Beltline.” He says “if we effectively target these areas this is a huge opportunity to take advantage of the huge growth of Atlanta.” Again, we’re seeing this if you look down at the next highlighted statement; Mike long in South Carolina also just talks about people moving to South Carolina from other, more populated states. He says “all of these areas are getting in influx of people over in the next five years, and they frankly have no way of growing; they have no idea how to do it. There’s just going to be a shortage of houses. Over the next five years our markets are going to become bigger, and bigger, and it’s going to be a great time.” We’re basically seeing that these effects of gentrification of the larger suburban markets, and we’re also seeing a continued trend of people moving from heavily populated, dense markets into some of the less populated, less dense areas of the south and southeast.

The South

The South is definitely a hot area as we go into 2018, just as it was in 2017; with rising home prices, inventory about the same as last year, which means continued constraints on inventory, and contractors and materials costs are going up in the South – again the South being one area that was had a major impact in 2017 as a result of Hurricane Harvey.

You’ll see that whole top band is Texas – from Austin all the way over to Houston – and it’s an interesting view: in Austin and Dallas Fort Worth, home prices are expected to increase, but everything else is expected stay about the same as 2017. Waco/Killeen is a market that’s probably one of the hottest markets in the United States today. It could be a result of the popular show on HGTV that’s based in Waco, but for whatever reason, people like Waco, and they’re moving there, so it has that hot market profile: rising home prices, decreasing inventory, everything else going up. As for Houston, everything is up, up, up. We will bring up a quote from the local market expert in Houston explaining these conditions in the next section. As we look across some of the other markets, areas like Oklahoma and Louisiana are either even, or shifting towards being buyer’s markets, where areas like Huntsville and Birmingham, Alabama have that hot market profile like we see in some of the other markets. Finally, at the bottom, we see Nashville and Memphis is really a tale of two cities in one state. The Nashville housing market seems to be cooling off, while the Memphis housing market is staying super, super hot.

As far as quotes to highlight from the south, Brad Reedy in Memphis, Tennessee said they expect their biggest challenge to be “less inventory and tighter margins,” and Clinton Newton in Huntsville, Alabama also mentioned the same, “tight inventory, more challenging to get deals at the right price to make the margin needed.” Notice what some of these guys said is the biggest opportunity in 2018: it’s to expand their use of the We Buy Houses® brand power, because in a super competitive market brand it’s more important than ever, and the way that the professionals can best stand out above all the newbies and the pretenders in the marketplace is to exploit their national We Buy Houses® brand in their local market. We definitely saw a lot of that in 2017, and we expect to see that brand push increase in 2018 in all these markets. I talked about the quote that our guy in Houston, Chris Uhler, had made regarding the post-Harvey market that they have down there: his quote is “We’re in a different ball of wax here after Harvey. That’s why I say it’ll turn into a buyer’s market. It’s tough because there’s really two markets now: the flooded market, and the non-flooded market. I think it’s going to be a buyer’s market for flooded houses for sure, because there’s going to be a lot more inventory than most investors are able to digest.” It really is a tale of two markets there: the flooded market and the non-flooded market; the flooded market being a buyer’s market, and a non-flooded market a seller’s market, in essence.

The West

Finally, let’s wrap up by looking at the West. In the West, we expect prices to rise, and inventory, contractors, and materials to be about the same as last year.

Looking across our local markets in the West, you see Seattle is one of the hottest markets in the country – it’s got that hot, hot market profile of rising prices, decreasing inventory, everything else going up. Go all the way down to the bottom, and you’ll see that St. George, Utah, which is a secondary/smaller market, has really shifted and, really, never was a substantial seller’s market, and they were likely a buyer’s market in 2017 as well. Depending upon the size of the market and the location of the market in the West, some of them are super, super hot, such as the Contra Costa market, and San Diego. Both markets have prices are either staying the same, because they’ve already been super high, or just continuing to increase. We’re hoping for cooling down of those California markets, as it’s very difficult to buy homes in California right now. Colorado Springs is another hot area where we see prices increasing inventory about the same as 2017 (but keep in mind that that means constrained), and we see the price of contractors and materials rise as markets like Colorado Springs continue to be very appealing to home buyers in 2018.

As far as the comments that we got from our local experts in the West, we wanted to highlight were from Tim Powers, who is in Contra Costa County/Walnut Creek, California area, and he said his challenges were “finding properties to buy due to low inventory, and competing with many, many investors” who are attracted to the California market, because it’s lucrative if you can find and flip a house – it’s just super hard to find them. Notice what Tim said under the biggest opportunity; he said “people will start to think that we are at the top, or near the top and will decide to sell.” That’s what we’ve seen in super-hot markets like in the West – in California – often, homeowners will delay selling a home, because they perceive that if they can just wait a few more months the price could go up another 10-30 thousand dollars, and that’s a great incentive for holding on for a little bit longer. Once they perceive that we’re near the top, or that prices are starting to decrease that mentality will shift, and they’ll be more likely to consider selling their home. Finally we wanted to highlight that Seattle market. J.J. Clark, our expert there, says “Seattle is absolutely crazy right now. Fastest growing large city in the nation, and leading to inflated prices, see: $400,000 for condemned tear downs. Really hoping for the market to correct itself.” We definitely saw that Seattle, Washington market having the profile of a very hot market for 2018.

Summary

In summary, as we step back and look at the four regions that we divided the country into, the Northeast and Southeast have very similar with home prices rising, inventory staying about the same, material costs rising in the Southeast and the South – where they’re dealing with those post hurricane situations. This tells a story if you step back, and look at of inventory (about the same as 2017), and prices rising, and that makes it a seller’s market across the country in 2018 according to our 40 local market experts in 33 markets across the United States. We see that it’s a seller’s market, in the primary suburban markets in the United States in 2018. There will be some demand and price softening among more expensive homes in most markets, and some softening and price and demand in secondary markets. Houston’s the only major market where we see a buyer’s market condition, but that’s really regarding the flooded market that was due to the Hurricane Harvey situation that occurred in 2017. Prices will be rising on typical homes in primary markets; We expect price increases in 2018 of 4% to 8% across most primary markets. As we wrap up 2017, the average home the median value is $248K, and we expect that to rise to $262K by the end of December 2018. Inventories will remain tight, with demand outpacing supply. Contractor and material costs will be about the same as 2017, or increasing, especially in the South and Southeast where they are recovering from major hurricanes.

We hope that you enjoyed our study, and that you got some great insights for it that will help you, and your planning for the markets in 2018.

For journalists and editors, we want you to know that our report is available for you to incorporate into your stories or articles related to housing market projections for 2018. For more information, or to arrange for an interview with our C.E.O., our V.P. of marketing, or one of our local market experts, contact us at Press@WeBuyHouses.com or call us at (817) 251-8296.

We wish you a Happy New Year, and we hope that everything goes well for you in 2018. We’ll see you again this time next year.

ABOUT We Buy Houses®

Trusted by more than one million homeowners over the past decade, We Buy Houses® is one of the most recognized brands in residential real estate investing. For more information about the company, please call 1-877-WeBuyHouses (1-877-932-8946) or visit https://WeBuyHouses.com.

]]>Can You Really Get an “Instant Offer” for Your House?https://marketing.webuyhouses.com/can-you-really-get-an-instant-offer-for-your-house/
Wed, 16 Aug 2017 18:33:10 +0000http://marketing.webuyhouses.com/?p=966A New Option for Home Sellers?

If you’re a homeowner interested in selling your house, you have more options today than simply listing your house with a real estate broker. A recent option seems almost too good to be true: The “Instant Offer”. Fill out an online form and – POOF – you get an instant offer for your house, dropped straight in your email! Easy, right? Well, maybe not. Read on.

Who Claims to Give “Instant Offers” for Houses?

Zillow recently introduced “Zillow Instant Offers” in a few of the hottest real estate markets in the country – Las Vegas, Phoenix and Orlando. Zillow does not operate a brokerage, and they do not make these offers or buy houses. Instead, the Zillow program is a lead-generation system; Zillow sells the homeowner information to real estate investors, agents, and brokers.

Other new real estate sites such as Opendoor.com and OfferPad.com (which, unlike Zillow, operate brokerages) claim to offer a better alternative to traditional listings, implying that you can just answer a few questions on their website and get an offer for your house in your email. These companies will actually make an offer and purchase your house.

Do You Really Get an “Instant Offer” for Your House from these Companies?

Actually, NO, you don’t. It turns out that there really is no such thing as a real binding “instant offer” for your house from any of these websites. In a nutshell, it’s a marketing technique. The intent is to capture the potential home seller’s information before anyone else does. The “Instant Offer” sounds easy and quick, so home sellers might be attracted to it before considering the more traditional path to sell their home. Once they go to one of these sites and fill out the form there, they are pulled into that company’s process, and soon they realize that – while an initial, non-binding offer may be presented to them within a day or two, the REAL offer comes later – after the home has been inspected. In other words, the instant offer is not so instant.

A quick look at Zillow’s Instant Offer webpage confirms these points:
1) They are SELLING YOUR INFORMATION to multiple cash home buyers (“investors”)
2) The investors will need to get a lot of info about your house, and getting an offer will take DAYS
3) The offer is subject to change upon the INSPECTION

The online brokerages such as Opendoor.com and OfferPad.com have a similar pitch – fill out a form, get an offer. But here again, their offers are not instant offers, and they are also not binding offers. Let’s take a look at the “how it works” information from those two sites.

Once pulled into their process, they have you sign a purchase agreement with them, and then arrange for a “free inspection” later in the process. In some cases, these companies may not perform these inspections until several days before closing. At that point, the seller has likely begun to pack or they may have already moved out. The information from the inspection can result in a significant adjustment to the offer for “unforeseen” repairs that can total thousands of dollars. It’s often hard for a seller to back out at this point, as they may have already committed to purchase another house. In that case, they have to settle for a big reduction in the actual offer for their house.

In addition, these online brokerages also charge commissions and other fees to the seller that are not apparent in their “get an instant offer” pitch. For example, Opendoor has a 7.2% “service fee” and OfferPad charges for commissions, an “OfferPad Fee” and for the “OfferPad Experience”. These fees, in their example below, add up to 9%:

CONCLUSION – There is no such thing as an “Instant Offer” for your house.

As we’ve seen with all three of these “new options” for selling your home, they are a bit of an “old wolf” in a “new sheep’s” clothing. None of these companies will make a real, binding offer on your home – instantly – based upon a form you complete on their website. What they will do is pull you into their process, get you to commit as soon as possible, then come to you later with a list of “adjustments” based upon the “free” home inspection. It’s not until then – perhaps a few days from closing – that these sellers learn what the REAL OFFER is for their house. In some cases, it can be tens of thousands less than the original offer. The risk for the homeowner is that the actual price that will be paid for their home is unknown until late in the process, leaving them with few options other than to proceed with selling their home to these online companies at a lower price than they expected.

Is there a way for home seller to get a REAL, FAST, BINDING OFFER?

Yes, there is. They can contact us at WeBuyHouses.com®. We are local professional real estate investors that are ready, willing, and able to purchase houses fast – with no repairs, no contingencies, no inspection surprises, no commissions, no “experience fees” and NO HASSLE.

WeBuyHouses.com provides home sellers with an On-the-Spot Offer – here’s how it works:

The homeowner fills out the form on the WeBuyHouses.com website, or calls their local WeBuyHouses.com office on the phone. We get just the information we need, and we schedule a time to come see your house ASAP.

Prior to arriving, we do research to determine the value of homes in your area and other factors that will help us determine our offer.

Once we arrive, we will do our own inspection of your property and THEN give you our On-the-Spot Offer offer, fully considering any repairs that may be needed.

If you like our On-the-Spot Offer, we’ll sign a sales contract with you right there on the spot.

Based upon your needs, we’ll schedule a closing date. We can often close on a house and put CASH IN YOUR HAND in less than 2 weeks. (At this point, the “other guys” haven’t even sent out their “free inspector” to figure out how much will be deducted from their offer!)

It’s that easy – the On-the-Spot Offer from WeBuyHouses.com is REAL, it’s FAST, and IT WILL NOT CHANGE ON YOU at the last minute like those “instant offers” from websites like those mentioned above.

For more information, go to WeBuyHouses.com or contact the company at 1-877-WeBuyHouses (932-8946).

DISCLAIMER: Local We Buy Houses® offices are independently owned and operated. Some local offices may not participate in offering an On-the-Spot Offer, but those that do not generally make a binding offer within 24-hours; still much faster and more dependable than the “instant offers” made by other companies.

About We Buy Houses®

Trusted by more than one million homeowners, We Buy Houses® is the most recognized brand in residential real estate investing. Every month, the company connects thousands of home sellers to local cash buyers via one of the largest networks of real estate investors in North America.

To sell a house quickly for cash, or for more information on residential real estate investing, call 1-877-WeBuyHouses(1-877-932-8946) or visit WeBuyHouses.com

The market strategists at WeBuyHouses.com® – one of the nation’s largest networks of residential real estate investors – see continued strength in the U.S. housing market through 2017. Market conditions should be favorable for participants in the residential housing industry – including builders, brokers/agents, investors, and lenders.

“We consider three key indicators – (1) housing starts, (2) existing home sales, and (3) investments in home renovations – and all three indicators continue to show strong demand for existing housing and increasing supply for new housing ,” explained Dev Horn, VP of Marketing for WeBuyHouses.com. “The market through 2016 has leveled off a bit, the curves have been flattening out. We see continued strength – but also continued supply constraints – in the housing market in 2017.”

WeBuyHouses.com® CEO Jeremy Brandt added, “The housing market was strong in 2016, just as we predicted last year. The market will remain very healthy in 2017, which is good news for everyone involved in real estate. Housing demand was well ahead of housing supply for the past few years, and we believe those inventory constraints will continue through 2017. But the fact that some of the housing trends have leveled off could be an indication that the gap between supply and demand may narrow a bit in 2017. We think this will be a positive for both investors and agents/brokers.”

KEY TAKE-AWAYS FOR REAL ESTATE PROFESSIONALS:

In an appreciating market, home sellers get unrealistic expectations. It’s better for investors (and agents as well) if home sellers have a more rational set of expectations. A “leveling off” of key housing indicators through 2017 is likely, and it would be is a healthy step that could help us avoid a housing bubble. Higher mortgage interest rates in 2017 could help to cool the market (demand) just a bit. A less frothy market would be better for real estate professionals.

However, even if the housing market moves toward equilibrium, constraints on supply will continue in 2017, causing home prices to continue to edge up in most urban and suburban markets in the U.S..

Let’s take a look at the data ~

NEW HOUSING STARTS

As we go press with this report, October 2016 data is coming out that shows a sharp increase in housing starts in both single- and multi-family units. According to the Wall Street Journal (11/14/2016):

Housing starts rose 25.5% in October to a seasonally adjusted annual rate of 1.323 million, the Commerce Department said Thursday, as multifamily housing starts came back with a vengeance. That was the highest pace since August 2007.

Single-family starts also continued to climb, reaching a rate of 869,000, another nine-year high.

The larger-than-expected gains across all regions “reaffirm our view that steady improvement in the housing market is likely to continue over the next two years,” said Rob Martin of Barclays Bank PLC.

Housing starts in multi-family are outshining the rise in single-family, but we see continued strength in both based upon the trend over the past 12 months:

Here again, although the news is that housing starts are at multi-year highs, the chart above shows a “leveling out” of the single-family data over the past year. We expect that level to remain relatively static, and expect the number of new single-family housing starts to run around to 800,000 per month over the next 12 months.

EXISTING HOME SALES

A look at existing home sales from October 2012 to October of this year shows a continuing positive trend line that has grown to around 5.5 million units (annually).

But a closer view of the data showing the percent change in sales BY PRICE RANGE over the past year is lot more revealing. The strong growth has been in homes above $250,000. Home sales for units below $100,000 actually DECREASED 14% year-over-year, and sales of units between $100,000 and $250,000 have been flat:

2016 saw an increase in first-time buyers as more millennials have begun to purchase houses, but there was also a decrease in reported “cash sales” and “distressed sales”:

This could indicate that the strong demand for single-family homes (coupled with constraints is supply) in 2016 actually decreased the number of lower-priced homes available for real estate investors to purchase.

Single-family housing supply levels generally increased over 2016, from less than 4 million units in December 2015 to around 4.5 million units for much of 2016. But housing supply for single-family units continues to run short of demand.

The supply constraints, coupled with strong demand, will continue to edge home prices up in 2017. The drop in sales of houses below $100,000 might be because there are simply fewer houses valued below $100,000 after several years of rising prices.Agents and brokers should benefit from a positive trend in home prices and the number units available at higher price points. However, for real estate investors who focus on single-family housing below $250,000, finding those deals will continue to be a challenge in 2017 as inventories for homes at those price levels will remain very tight.

THE HOME DEPOT INDICATOR

OK, so this one is not very “scientific”, but some thing the stock price of Home Depot can be an indicator that money being invested by homeowners and investors to improve houses. As the housing market recovered over the past five years, Home Depot stock has shot up from below $50 in 2012, to over $120 per share a year ago. It now sits at around $131 per share:

But a closer look at the data over just the past 12 months shows that Home Depot has been stuck in a trading range around $130 all year:

The performance of Home Depot stock over the past year might be indicating that the home improvement market has leveled off a bit in 2016. However, the stock sits at a 5-year high, so interest in home improvement remains very strong as we go into 2017.

IMPACT OF INCREASING INTEREST RATES

The Federal Reserve has indicated that it is likely to increase the federal reserve rate in December, perhaps by 25 basis points, and that they may increase rates a couple of times in 2017. We expect the rate increase in December will happen, and that there will be at least one rate increase in 2017. As a result, we are expecting a 50 basis point (0.5%) increase in the fed funds rate over the next year.

This increase in the underlying rates will push mortgage interest rates up in 2017. In general, increasing mortgage rates could depress home sales. However, rates will still be relatively low historically and demand for housing is expecting to remain strong, so it’s not clear if increasing rates will actually decrease the volume of home sales.

WeBuyHouses.com does not expect any negative impact of rising interest rates (e.g., on existing home sales) unless rates rise above 5% on 2017. And, we believe the Trump administration & the Feds will want to keep rates below 5% next year.

Freddie Mac data over the past year shows that rates are around where they were a year ago.

CHANGES IN REGULATION EXPECTED UNDER TRUMP

As a result of the election of Donald Trump, there is now an expectation that his administration will seek to reduce regulations that affect banking and lending, such as Dodd-Frank.

A loosening of regulations on the banking industry could make it easier for first-time buyers to get a home loan, which could increase demand for housing at the lower end of the price curve (i.e., below $250,000).

We expect that, if a loosening in regulations occurs in 2017, the positive effects of those changes will offset the negative effects of higher interest rates.

CONCLUSION

We see that many of the key housing indicators remained strong but may have also “leveled out” in 2016. We believe this is good for the housing market. Demand for housing has exceeded supply which has driven up prices and, in some cases, pushed investors out of the market. We saw a big upswing in our key housing market indicators from 2010 to 2015. So, a slight leveling off in 2016 shows us that the market may be normalizing – which is necessary to avoid another bubble in the housing market.

In 2017, inventory of existing homes will remain very tight in urban and suburban markets that are in high demand. We don’t see any developments that will significantly increase supply in the next 12-months. Perhaps rising rates – which can cause sales to spike initially – will cool the market off just a bit and help it to reach a point closer to equilibrium in the next year. Regardless, we see another year of rising prices and tight inventories ahead in 2017.

The market strategists at We Buy Houses® (WeBuyHouses.com) – one of the nation’s largest networks of residential real estate investors – see extremely bullish signals for the U.S. housing market through the next 12 to 18 month cycle. This bodes well for all aspects of the residential housing industry – including builders, brokers/agents, investors, and lenders.

“We look at three key indicators – (1) housing starts, (2) existing home sales, and (3) investments in home renovations – and all three of those indicators are at multi-year highs,” explained Dev Horn, VP of Marketing for We Buy Houses®. “With the announcement of existing home sales today, we’re seeing the strongest housing market since 2007, and we believe this strength will continue well into next year.”

We Buy Houses® CEO Jeremy Brandt added, “We’re extremely encouraged by the positive trends in the real estate market, especially in the south and west where we have a strong presence of local We Buy Houses® offices. The strength of these key indicators is a very positive signal that U.S. residential real estate is one of the most attractive asset classes in the world right now. We’re expecting our business owners – and others involved in residential real estate – to have a very strong tailwind headed into 2016.”

THE STATS…

THE “NEW HOUSING STARTS” INDICATOR – HIGHEST LEVEL SINCE 2007

According to the U.S. Department of Commerce, groundbreaking increased 0.2 percent to a seasonally adjusted annual pace of 1.21 million units, the highest level since October 2007. In July, groundbreaking for single-family homes, which accounts for the largest share of the market, surged 12.8 percent to a 782,000 unit pace, the highest level since December 2007. Single-family home building in the South, where most of the home construction takes place, rose to the highest level since January 2008.

THE “EXISTING HOME SALES” INDICATOR – HIGHEST LEVEL SINCE 2007

Per CNBC, “U.S. home resales rose more than expected in July to their highest level since 2007, a sign the U.S. housing market was heating up and could provide more support for the overall economy.”

The National Association of Realtors said on Thursday existing home sales increased 2 percent to an annual rate of 5.59 million units. Sales were up 10.3 percent from a year ago.

THE “HOME DEPOT” INDICATOR – STOCK AT A 5-YEAR HIGH

We Buy Houses analysts also look at the performance of businesses that supply the home renovation market – in particular, Home Depot, which serves a much larger contractor base than Lowe’s.

Shares of the world’s largest home improvement retailer are near a 5-year high.

About We Buy Houses® / WeBuyHouses.com

Trusted by more than one million homeowners, We Buy Houses® is the most recognized brand in residential real estate investing. Every month, the company connects thousands of home sellers to local cash buyers via one of the largest networks of real estate investors in North America. To sell a house quickly for cash, or for more information on residential real estate investing, call 1-877-WeBuyHouses (1-877-932-8946) or visit WeBuyHouses.com.

]]>New Multi-Family Marketing Strategy and Assetshttps://marketing.webuyhouses.com/multi-family-marketing-strategy/
Wed, 29 Apr 2015 17:59:38 +0000http://marketing.webuyhouses.com/?p=603Have you been considering expanding your marketing to include multi-family properties such as duplexes, quadplexes, and apartment buildings? Several of our licensees have begun marketing to this type of property owner, so we’ve developed a new postcard and marketing strategy to get multi-family property owners contacting YOU to sell you their income-generating property.

]]>We Buy Houses Brochures Are Here!https://marketing.webuyhouses.com/we-buy-houses-brochures-are-here/
Wed, 04 Mar 2015 17:22:19 +0000http://marketing.webuyhouses.com/?p=585We are continuing our efforts to bring clarity and professionalism to residential real estate investing via the We Buy Houses® brand. Our new brochure TELLS THE STORY – who we are, what we offer, how it compares to other options, and why our offer might be the best fit for the home seller.

]]>NEW! Variable-Print Bandit Signs & Absentee Postcardshttps://marketing.webuyhouses.com/new-variable-print-bandit-signs-absentee-postcards/
Mon, 03 Feb 2014 21:22:35 +0000http://marketing.webuyhouses.com/?p=335If you are a licensee, you probably got our SNEAK PEEK announcement about these new advertising assets in development. Well, they are NOW AVAILABLE for purchase in the FULFILLMENT CENTER.

NEW ABSENTEE POSTCARD SERIES

Everyone knows that absentee owners are a great target list. The first We Buy Houses® Absentee Owner Postcard quickly became the #1 call generator in our direct mail program. So we took that first design – improved it – and added two more Absentee Owner Postcards to create a 3-card series. Here’s a look at one of the new postcards:

NEW VARIABLE-PRINT BANDIT SIGNS

Our “old” bandit sign has been a WINNER. People respond to the clear, professional message conveyed via these high-quality printed designs. To build on this success (and respond to your requests), we’ve just introduced a new set of VARIABLE-PRINT bandit signs. Now you can choose your message AND put your LOCAL PHONE NUMBER on your signs! Check out this new design:

We continue to listen to our licensees and develop new marketing strategies and assets that fit your needs and enhance your profile in your local market. There are a LOT MORE exciting developments right around the corner, so STAY TUNED!

– Anyone who speaks one of more than 200 languages now can sell their home more easily and quickly –

LanguageLine SolutionsSM, the global leader in over-the-phone interpreting, announced today it has partnered with We Buy Houses® – a national provider of marketing services to residential real estate investors – to provide interpreting services to investors in their national network. We Buy Houses® investors offer homeowners the option to sell quickly for cash in markets throughout the U.S.

“The demographics of home ownership in the U.S. have shifted dramatically, and we want to be the first in our industry to acknowledge the importance of different cultures and languages in real estate transactions,” noted Jeremy Brandt, CEO of We Buy Houses®. “The number of U.S. homeowners that do not speak English as their primary language has grown dramatically over the past decade. They are now represented across all demographics and geographies, so any successful professional in our business must have a strategy to deal with language barriers. Most of our clients are not multilingual, so it’s critical to have a strong language partner to ensure that can work with all homeowners in the language of their choice.”

“Selling your home can be a difficult and confusing process even if everyone involved speaks the same language. We Buy Houses® investors simplify the home selling process, and now they can do so in more than 200 languages thanks to our 6000 interpreters,” said Scott W. Klein, President and CEO of LanguageLine Solutions. “Armed with only their cell phone, We Buy Houses® licensees can access our Over the Phone Interpretation (OPI) service at the exact moment they need it, in any location. In less than a minute, they connect with an appropriate language interpreter and they are able to conduct business with homeowners who speak a different language.”

“It’s truly a revolutionary capability,” added Brandt. “Our licensees can now access 100% of the opportunities in their local market while delivering services that are highly tailored to the needs of home sellers. Language used to be a barrier in our business. With LanguageLine’s OPI service, we have overcome that barrier.”

The U.S. Census reported that the number of limited English proficient individuals grew by 80 percent between 1990 and 2010 and is expected to continue growing, fueling the demand for even more access to interpreters.

About LanguageLine SolutionsSM

LanguageLine Solutions is the global leader in Over-the-phone interpreting and the fifth largest interpreting and translations company in the world, and is recognized as a trusted partner to nearly 25,000 clients of public and private organizations throughout the United States, Canada and the United Kingdom. For more information about LanguageLine Solutions’ suite of telephone, video interpreting, document translation and localization, and interpreter assessment and training programs, please call (800) 752-6096 or visit www.languageline.com.

About We Buy Houses®

Trusted by more than one million homeowners, We Buy Houses® is the most recognized brand in residential real estate investing. Every month, the company connects thousands of home sellers to local cash buyers via one of the largest networks of real estate investors in North America. For more information, call (877) WeBuyHouses (932-8946) or visit www.webuyhouses.com.

]]>Speaking of Names… WeBuyHouses.COM!https://marketing.webuyhouses.com/dot-com-branding/
Tue, 21 May 2013 17:02:07 +0000http://marketing.webuyhouses.com/?p=178As a result of brand testing that we recently completed, you’ll notice a subtle but important change to your branding. We’ve found that consumers respond with more ACTIONABLE BRAND AWARENESS when we included the .com in your We Buy Houses® logo. What that means is, consumers remember the brand better with the .com added, and more importantly, they have a better understanding of HOW TO CONTACT YOU after seeing it. Here is an example of the revised logo on our new JUMBO postcard:

BUT YOU ARE WE BUY HOUSES® (Not Just WeBuyHouses.com)

Your licensing rights are not just for the We Buy Houses® website and complete marketing system, you are also licensing the BRAND in your market area. And the brand is backed up by a federal trademark on “We Buy Houses” and “WeBuyHouses.com”.

YOUR SUCCESS IS JOB #1

The change to the new “.com” logo will make your marketing message even more memorable. Imagine, after sending just a few postcards like those above to your target market, you will have effectively cemented in their mind that there is only ONE WeBuyHouses.com – and that is YOU.

I share this with you not just to tell you about this subtle change to your branding, but to emphasize that we are always testing, responding, and evolving to help you to be more successful. At the end of the day, that’s what it’s all about.

]]>It’s All in a Name ~ Who Are You?https://marketing.webuyhouses.com/its-all-in-a-name/
Thu, 11 Apr 2013 05:39:05 +0000http://marketing.webuyhouses.com/?p=76I recently called an investor and thought I had the wrong number. The voicemail greeting said “You’ve reached [Acme] Construction, please leave a message”. I did not leave a message.

Instead, I called back an hour later and a man answered, “[Smith] Real Estate, this is [John].” (The names have been changed to protect the innocent.)

“Is this [John’s] Investment Co.?”, I asked, using the company name he had given us previously.

“Oh yeah, this is John. How can I help you?”.

John is the one that could use some help here. He’s having an identity crisis. You see, John is a residential real estate investor. He advertises “John Buys Houses” with bandit signs and postcards – all with the same number that I called to reach him.

He is also selling the houses he flips (his wife is an Agent), and he is a partner in a construction company with his brother. (His brother is the project manager for the rehabs they do to investment properties.). And for all those activities, he has different business names and phone numbers that all forward to his cell phone. At this point, he should probably just answer the phone “This is John!” and wing it from there!

John was interested in using the We Buy Houses® system. (Notice I said “using” rather than “joining”.) He said, “I like that website address and phone number. I’m interested in anything that can help me get a few more calls.”. I could see it now. John would put out some We Buy Houses® bandit signs and when people saw them and called 877-WeBuyHouses, they would probably hear “You’ve reached [Acme] Construction, please leave a message”. Click.

IT’S ALL IN A NAME

1-800-GOT-JUNK? is a franchise success story. Started with $700 in 1989 by CEO Brain Scudamore in Vancouver, British Columbia, it is now the world’s largest junk removal service with 175 franchise locations in Canada, the United States, and Australia. What is the secret to their success? According to 1-800-GOT-JUNK?:

“Everybody has junk but has difficulty getting rid of it! Just look in your local newspaper – there are countless ads for ‘man with truck’. This shows that the junk removal business is a fragmented industry in need of a national and trustworthy brand – that’s where 1-800-GOT-JUNK? comes in.”

Their secret to success is the most obvious thing about them – it’s the 1-800-GOT-JUNK? brand and the IDENTITY that comes with it – the logo, the vanity number, the fleet of blue and green trucks (which are rolling billboards for the brand), the clothing that franchise employees wear, the website, phone system, etc. It all works together to create a brand experience. If you needed junk removed, who would you think to call?

Now, what if you called 1-800-GOT-JUNK? and someone answered the phone “Fred’s Carpet Cleaning & Paintless Dent Removal, how can I help you?”. Click!

You get the message. The brand experience – from seeing the ad, to calling the number, to meeting with you in person – is extremely important to the way that people perceive you. If there is a break in that chain of the brand experience, you lose trust in the mind of the homeowner.

BRAND MATTERS

Can you think of any other fragmented industries that could benefit from a reputable, national brand? How about residential real estate investing?

In any major city, right now, there are dozens of active real estate investors trying to find their next deal (or their first). Each one has their own “brand” – from “Billy Buy Houses Fast in Dallas Fort Worth Texas” (seriously, no “s” on Buy) to “SuperCashForHouses.com” to ____insert any of a 1,000 more names here____.

Ours is a very fragmented industry.

Heck, consider John in our story above. He is a very fragmented business person! When his phone rings, he literally has an identity crisis.

Look, I’m not going to turn this into a sales pitch for We Buy Houses®. I’m assuming that you’re “one of us” now. But have you joined We Buy Houses® or are you just planning to use it? Is it one way that you’re going to generate some leads, or is it the way that you’ll do business?

With We Buy Houses®, you have all the components to create a brand experience that homeowners will trust. So, when that phone rings, how will you be answering it?

We Buy Houses® is the best brand in real estate investing. We encourage you to take full advantage of this integrated marketing system. BE We Buy Houses® in your community. Your investment in this brand will put you head and shoulders above the competition.